Tax on Raisin Interest

wmb194

financies said:

A point of fiscal interest may be that Raisin offers "Sharia accounts", which do not pay interest as such but present it as profit-sharing, which therefore should be considered not to be taxed interest, but rather capital gains taxed.

No, the "profit" on these accounts is taxed as interest. If it was taxed in the same way as normal company profit distributions it would be taxed as a dividend, not capital gains.

Notepad_Phil

wmb194 said:

financies said:

A point of fiscal interest may be that Raisin offers "Sharia accounts", which do not pay interest as such but present it as profit-sharing, which therefore should be considered not to be taxed interest, but rather capital gains taxed.

No, the "profit" on these accounts is taxed as interest. If it was taxed in the same way as normal company profit distributions it would be taxed as a dividend, not capital gains.

Or as someone once said "You may not consider a Sharia account as paying interest, but the HMRC certainly does."

Bigwheels1111

Notepad_Phil said:

wmb194 said:

financies said:

A point of fiscal interest may be that Raisin offers "Sharia accounts", which do not pay interest as such but present it as profit-sharing, which therefore should be considered not to be taxed interest, but rather capital gains taxed.

No, the "profit" on these accounts is taxed as interest. If it was taxed in the same way as normal company profit distributions it would be taxed as a dividend, not capital gains.

Or as someone once said "You may not consider a Sharia account as paying interest, but the HMRC certainly does."

Double whammy for me Sharia account via Raisin.

Will they report it or not ?.

Who knows.